The market for methods to fingerprint foods and consumer products is growing at an annual rate of 16% and is accelerating in response to the estimated $15 billion cost of food fraud alone. Food fraud being difficult to detect, the actual cost in terms of lost revenue to companies and lost value to consumers may be several times higher.
A real-world example is provided by dairy processing at Nestle'. One manufacturing site alone performs 2,000 analyses of milk and milk products every day in an effort to verify the products' points of origin. Most of these measurements are based on conventional spectroscopic techniques including FTIR and NMR. Performing multiple tests to characterize each sample is time-consuming and costly. Were milk samples labeled with colloidal fingerprints at the source, identifying point of origin could be achieved in a matter of minutes with a single measurement. Substituting inferior milk for premium dairy products early in the supply chain has become a lucrative revenue source for organized crime. Colloidal fingerprinting has the potential to substantially reduce the economic, health and safety costs of supply-chain tampering.
Despite great steps taken to prevent drug counterfeiting, the pharmaceutical industry experienced a loss of $514 billion in 2012 due to counterfeiting, primarily in over-the-counter products. Luxury products such as perfume, wine and spirits are another target of counterfeiting because of their potential for large profit margins. Wine Spectator magazine speculates that as much as 20% of the wine on the global market today may be counterfeit. Milk is one of the most defrauded products worldwide. The low cost of milk and the difficulty in detecting adulteration makes milk a particular challenge for counterfeit detection. The largest segment of the market for milk is our most vulnerable, infants and children. The need for a cost-effective and versatile method of fingerprinting milk is a global unmet need.
Anti-counterfeiting measures for fluid products have focused on secure and traceable packaging or on chemical analysis of a statistical sample of the product. Major corporations, such as Alien Technology and 3M Company, have pursued the former strategy by adding high tech labeling, coatings or additives to packages that are difficult to duplicate. These measures help to ensure the integrity of the package. Further incorporating anti-tampering technologies helps to ensure that the package actually contains the advertised product. Such measures, however, tend to be costly, and still can be circumvented by determined counterfeiters. The expense associated with chemical analysis does not allow for comprehensive verification of every package, particularly not for commodity products such as milk. Exhaustive analysis of a statistical sample of products, however, has brought to light many of the known cases of product fraud. Many more are assumed to remain undetected.
Adulteration of consumer products and food costs the U.S. economy more than $15 billion a year. A single incident of product fraud costs between 2 to 15 percent of a company's revenue for that product. The FDA is working to increase the safety of the national food supply through new regulations, but is limited by the availability of methods to detect fraud, adulteration and counterfeiting.